Paying back UC Advance and Budgeting Loan?

Can anyone help me with this? I had a UC Advance & Budgeting Loan and I'm just thinking out loud about the consequences of not paying it back if/when I move off benefits. Obviously if I had a full time job and could afford repayments I would do so and am not seeking a way to avoid my responsibility of paying it back.

Merely just trying to reassure myself that if I genuinely can't afford to pay it back, then I won't be punished for not doing so.

I guess what I am asking is because this is effectively "government money" and also might be classed as "benefit overpayment", just how high priority would this debt be considered? I have dealt with debt collection companies hundreds of times and their powers are very limited, often just sending you threatening letters until they give up. Unless its for something serious like council tax etc

You can also just offer them a token payment of £1.00 per month and they have to accept it. I'm basically not worried about a private debt collection agency and would probably rather deal with them than the DWP themselves.

This is all the relevant information I can find

DWP wrote:If you move off benefits you will receive a letter telling you how much you owe. The letter will ask you to contact DWP Debt Management Contact Centre to arrange your repayments. It is important that you do not ignore this letter.

If you don’t make payment arrangements, the DWP can recover the amount you owe by either:

   * contacting your employer (where you have one) to arrange for deductions to be made from your earnings
   * asking an independent debt collection agency to collect this money on our behalf (you should deal directly with the independent debt collector to arrange repayment)

If you no longer get Universal Credit and cannot pay back your advance

You can contact the DWP Debt Management contact centre if you can’t afford to pay back the amount you owe.

They can help you come to an affordable arrangement to pay back your advance as well as providing:

   support with setting up monthly repayments by Direct Debit
   paying-in slips for cheque or cash payments

https://www.gov.uk/guidance/universal-credit-advances

So in a nutshell....Am I right in thinking that if I was unemployed and not receiving benefits there is very little they can do?

I know if I was employed they could potentially deduct an amount from my earnings but this isn't really relevant because if I was employed I would negotiate a payment plan well before it got to this stage.

Thanks

Assuming you areno longer claiming UC! Yes you are right Dylan!

DWP uses several differenct collection agencies, for example: https://www.ccscollect.co.uk/dwp-debt.html

Government worse debt collectors than private companies
https://www.citizensadvice.org.uk/about-us/how-citizens-advice-works/media/press-releases/government-debt-collectors/

Thanks for those links ND. I wasn't aware that the DWP could seize wages and assets without a court order though, damn!
(hopefully unlikely for just a benefit advance and/or budget loan though...but you never know)

I wonder if these are considered "benefit overpayments"? because technically they are interest-free loans essentially.

dylan wrote:Thanks for those links ND. I wasn't aware that the DWP could seize wages and assets without a court order though, damn!
(hopefully unlikely for just a benefit advance and/or budget loan though...but you never know)

I wonder if these are considered "benefit overpayments"? because technically they are interest-free loans essentially.

A benefit advance is akin to a salary advance, it is not a loan. Usually both are recovered via benefits/salaries.